Method and system for managing distributor information

ABSTRACT

An embodiment of the invention provides a system that enables financial services companies to manage and track information about a sales force. The system includes components for managing distributors information, for validating and tracking licenses and credentials, for creating customized contracts, and for maintaining compensation structures. The system allows for configuring compensations, providing financial services companies a toolkit for creating and modeling their complex commission schedules used to compensate their sales force. The system also provides modeling tools for agreements and contracts between a financial services company or provider and the distributors who sell products. The system has a multi-component architecture comprising multiple modules, multiple data processing engines, a backbone and multiple data sources. The processing modules carry out information processing using one or more data processing engines. The data processing provides the tools to fetch data from the databases and process it.

FIELD OF THE INVENTION

[0001] This invention relates to the field of computer technology. Morespecifically, the invention relates to a method and system for managingdistributor information.

[0002] Portions of the disclosure of this patent document containmaterial that is subject to copyright protection. The copyright ownerhas no objection to the facsimile reproduction by anyone of the patentdocument or the patent disclosure as it appears in the Patent andTrademark Office file or records, but otherwise reserves all copyrightswhatsoever.

BACKGROUND

[0003] Managing sales and distribution channels has become a difficulttask in today's business environment where it is necessary to quicklyand fairly administer incentives for salespeople and distributionchannel partners while coping with regulatory issues. To keep revenuesgrowing and keep up with customer demands, financial services providershave to move quickly even when regulation, competition and new salesdistribution channels inhibit growth. Management is expected to providenew opportunities for improved revenues and margins, while providingcustomers with better, faster information and services.

[0004] The distribution channel model within the financial servicesindustry is very complex. Products are sold across multiple distributionchannels and the workforce is very fluid, with individual distributorsworking for multiple companies and engaging in multiple agreements withservice providers. There are regulatory constraints on the sales forcein that all distributors who sell products must be licensed andappointed, or authorized, to sell those products. Financial servicescompanies must track all of this information about their sales force,maintain a history of all of this information, provide incentive basedcompensation to their sales force, and calculate their compensationbased upon numerous variables. Consequently, any plan for distributionchannel management must consider the number of channels, the number ofdistributors, compensation complexity, regulatory and licensingrequirements and the number and types of products that will be sold.

[0005] Financial service companies are being driven by increasedcompetition to consider the use of independent agents in place ofcaptive sales staff. Firms may wish to enhance and reward crossdistribution channel interactions. They must be able to enhancedistributor reporting and communication and effectively manageindependent brokers and captive sales staff. They must reduce the timerequired to market new products and implement new compensation plans anddifferentiate themselves based on services offered to customers. Inaddition, they must be able to rapidly integrate new distributionchannel acquisitions and grow distribution capabilities, while reducingadministration costs.

[0006] Cost avoidance is essential as mergers and acquisitions have ledto many disparate systems, some of which are antiquated. Firms mustreduce implementation time for new products and compensation plans onthese antiquated systems and reduce the potential for overpayment. Thegoal must be a reduction in the overall cost of administration.Accordingly, these companies must interact with the producers (of sales)using preferred methods and quickly model new and creative compensationplans, while consolidating compensation administration systems.

[0007] In order to provide sales representatives with an incentive tosell as much as possible, or to sell more of a desired product orproducts at certain prices, sales organizations create incentive planswhere commissions are provided or offered to the sales representativeswhen specific sales goals or targets are achieved during particularperiod of time. In addition, an incentive plan may apportion credit toeveryone on a sales representative's sales team, to the representative'smanager, or someone other than the sales representative himself. Salesrepresentatives typically receive compensation based on a salary, thehours worked, and/or on the goods or services sold. When basingcompensation on transactions, specifically on the goods or servicessold, sales representatives receive a commission that can be based onprofits, net sales, the number of products sold, or some other variable.Other primary compensation includes gross dealer concessions. Secondarycompensation includes expense allowances, persistency bonuses andoverrides that can be allocated among sales teams and accumulated overtime if desired.

[0008] Sales compensation for direct and indirect channels can be one ofthe most effective levers for aligning sales performance with businessgoals. Unfortunately, designing and administering effective incentiveprograms is a difficult management challenge. The management of abusiness can spend a great deal of time and money in developingincentive plans. In the prior art, the creation and distribution ofincentive plans is a slow process that is prone to error. It can takemonths to implement a new compensation plan, and dependencies oncomputer software can frustrate sales managers who want to make evensimple changes. Moreover, a lack of measurement tools can make itimpossible to develop a “closed loop”, continuous improvement process.Businesses must be able to design, process, and communicatesophisticated incentive programs that drive revenue growth across allsales channels. Businesses need to streamline the administration ofquotas, territories, and commissions, and also require tools to measureand improve the effectiveness of incentive programs. This would greatlysimplify the management challenge of aligning tactical businessperformance with strategic objectives, making it possible to react morequickly and effectively to changes in market and competitive conditions.

[0009] Quotas are a necessary component of most sales compensationplans, yet they are notoriously difficult to administer, especially whenthey involve multiple hierarchies. Not only is it easy to introduceproblems like double counting and under- or over-payment, but alsochanges typically require long turnaround times while they areimplemented by changes in computer software. The management of salesquotas is difficult and there is a need to be able to manage them easilyand accurately, allowing business users to assign quotas by territory orposition and across multiple hierarchies. Managers also require acapability to accurately track sales results and forecast futureperformance. Needed elements include the ability to tie quotas betweenpositions and sales teams or positions and territories, make salesprojections, a provision for quick and easy quota setting and editing,and a simple interface for use from the field.

[0010] Managing sales territories involves analyzing past results,assigning territories, and forecasting future sales performance. Formost organizations, it is a difficult and time-consuming process withthe result that it is commonly only undertaken once a year.Unfortunately, market conditions change continuously, making itpractically impossible to keep sales territories aligned with businessneeds for more than a short period of time. A more automated process forterritory management is needed to allow large sales organizations tokeep up with the market.

[0011] Another need of firms in financial services is an ability tomanage sales producer payment accounts by defining multiple accounts perrepresentative, setting up payment rules for each account and proceduresfor adjustments. Loan issuance against customer accounts must also bemanaged. Loan and repayment schedules, and appropriate records, must bemaintained. As a part of this activity, it is necessary to trackeligible compensation against parameters established for the loan and tobe able to track collection of the loan and initiate charge-back andfrom the producer if appropriate.

[0012] In the area of distributor administration, firms also would liketo manage a shared repository for all producer information, includingpersonal information, professional information and preferences. There isa need to provide a view of the roles played by individuals with anorganization, and active selling agreements and reporting relationships.Firms would like a centralized distributor repository in order to beable to view, report and compensate producer relationships individuallyand holistically. In addition, they must reduce errors ormiscalculations leading to overpayment. At the same time, these firmsmust assist new agent distribution channels in learning how to sell newtypes of products and create new distribution capabilities for existingproducts.

[0013] Credential management is a critical issue for many firms. Theymust track professional accreditation including licenses, appointments,National Association of Securities Dealers (NASD) registration andcontinuing education requirements for the maintenance of theseprofessional accreditations to ensure that they are represented byappropriately credentialed representatives. This need is made more acuteby constantly changing government rules and regulations, as well as bydifferent regulations imposed by the different jurisdictions in which afirm operates. Firms must determine when renewal processing is requiredand manage new and renewal application processes to ensure regulatorycompliance in every jurisdiction. A further problem is presented byrepresentatives who may move from jurisdiction to jurisdiction in thecourse of their representation of a firm. Further, there is substantialturnover in representation resulting in a continuing need to ascertainthe credentials of new representatives as well as to maintain contactwith former representatives in the event that issues arise from theirformer representation.

[0014] In order to appropriately manage their representatives, firmsmust also be able to create customized contracts and selling agreementsby combining reusable compensation components and personalizingagreement templates to fit individual producers. A selling contractdefines a hierarchy of sales people that can sell products under thatcontract and it defines what products can be sold under that agreement.The selling contract also specifies commission schedules and identifieswhich sales people participate under a particular commission schedule.As multiple versions of such agreements may come into use over time, aprocedure is needed to allow multiple users to maintain agreementsthrough versioning, or version control, and a method must be provided tomanage the approval process for agreement components and templates.

[0015] Any distribution management channel solution, in order to beuseful, must have a capability for error correction, including manuallyinputting and adjusting all transaction information, making retroactiveadjustments and viewing and managing ledger items. Other features thatare desirable include the ability to cancel and rerun transactions.

[0016] Many financial services firms would like to be able tocommunicate distribution channel management information over theInternet so that producers can view the state of their relationship witha firm, including profile information, licenses, appointments, productinformation, contract and compensation information. Firms would alsolike to be able to perform modeling and “what if” analysis and have theability to capture historical data to make strategic decisions about theeffectiveness of future plans. A set of Web-based incentive managementproducts that can be deployed to practically any sales or distributionchannel would be useful. Such tools could greatly simplify the burden ofdesigning, forecasting, launching, measuring, and refining incentivesprograms.

[0017] Computer software is necessary to implement the solution to theseproblems and fulfill the perceived needs just described. Such softwarecommonly utilizes multiple related functions and data structures. Toencapsulate these related functions and data structures, the softwareoften utilizes a standard object oriented programming (OOP) languageapproach.

[0018] In conclusion, there is a need for a solution, implemented on acomputer in an object oriented programming environment, that manages thecontracts between the manufacturers of a product, which may includefinancial services, and the distributors of their product in an industrywhere there is multiple channel selling, a fluid workforce, andregulatory constraints. This solution should track information, such ascontact points, payment methods, and the organizational hierarchies, onall parties in the system. It must manage regulatory information andensure that distributors are licensed and appointed to sell the productsmanufactured, or distributed, by the provider. In addition, the solutionmust allow for compensation configuration and provide financial servicescompanies with a toolkit for creating and modeling their complexcommission schedules used to compensate their sales forces. This shouldinclude a provision for charge-back of commissions if appropriate. Also,the solution must model contracts between the financial servicescompany, or provider, and the distributors who sell the products. Thesolution must calculate compensation for all distributors and shouldallow for access through the Internet.

SUMMARY OF THE INVENTION

[0019] The invention provides a method and system for managing contractsbetween manufactures of a product and the distributors of their productin an industry comprising multiple channel selling, a fluid workforce,and regulatory constraints. An embodiment of the invention provides asystem that enables financial services companies to track informationabout their sales force, maintain a history of all of the information,provide incentive based compensation to their sales force, and calculatetheir compensation based upon numerous variables. The system referred tohereinafter as Distributor Management System Suite (DMSS) comprises asuite of applications that provide tracking information, such as contactpoints, payment methods, and organizational hierarchies on all partiesin the system, managing regulatory information and ensuring thatdistributors are licensed and appointed to sell the productsmanufactured by the provider. The DMSS provides financial servicesinstitutions with the means to maintain distributor records, contracts,and commissions. The DMSS includes components for managing informationrelated to distributors, validating and tracking licenses, creatingcustomized contracts, and maintaining compensation structures. Theinformation stored in the DMSS database includes contract components andrules, distributor financial information, bonus schedules, and licenseand appointment data.

[0020] In an embodiment of the invention, the DMSS allows forconfiguring compensations, providing financial services companies atoolkit for creating and modeling their complex commission schedulesused to compensate their sales force. The DMSS provides modelingcapabilities for agreements and contracts between a financial servicescompany or provider and the distributors who sell products. In anembodiment of the invention, the DMSS calculates compensations for alldistributors, processes payment and manages dept.

[0021] In an embodiment of the invention, the DMSS comprises severalcomponents comprising management modules, a backbone, one or more dataprocessing engines, databases, and storage management components. Thebackbone allows for data exchange between components of the DMSScomprising module-to-engine and engine-to-database data exchange.

[0022] In an embodiment of the invention, the DMSS comprises dataprocessing engines. These system components are designed to drawinformation from the DMSS databases, process the information, and storethe result in a database for further use by the DMSS modules andengines.

[0023] In an embodiment of the invention, the DMSS is composed ofseveral modules comprising a distributor administration module, alicense and appointment module, a selling agreements module, a debtmanagement module, and a payment module. These modules interact with thebackbone and engines to maintain relationships between financialservices institutions and their distributors.

DESCRIPTION OF THE DRAWINGS

[0024]FIG. 1 shows a block diagram representing an embodiment of asystem that utilizes the Distributor Management System Suite (DMSS).

[0025]FIG. 2 comprises a flowchart showing the process of communicatingbetween modules, the data processing engine, the DMSS backbone and thedatabases in an embodiment of the invention.

[0026]FIG. 3 show a block diagram representing an example ofinteractions occurring within DMSS modules and engines in an embodimentof the invention.

[0027]FIG. 4 shows a hardware environment for executing one or moreaspects of the invention.

DETAILED DESCRIPTION

[0028] The invention provides a method and system for managingdistributor information. In the following description, numerous specificdetails are set forth in order to provide a more thorough understandingof the invention. It will be apparent, however, to one skilled in theart, that the invention may be practiced without these specific details.In other instances, well-known features have not been described indetail in order to avoid unnecessarily obscuring the invention.

[0029] System Overview:

[0030] An embodiment of the invention comprises an extensible method formanaging relationships between institutions (e.g., suppliers/manufacturers) of a product or service and the distributors of theirproduct. Aspects of the invention are targeted at industries where thereis multiple channel selling, a fluid workforce, and regulatoryconstraints upon products sales. For example, systems embodying theinvention provide a way to manage the agreements that financial servicescompanies have with the distributors who sell their products. Thus,organizations such as life insurances companies may utilize embodimentsof the invention to manage the sale and distribution of life insuranceplans in a way that coincides with the regulatory constraints ofgovernment organizations.

[0031] Such companies can utilize embodiments of the invention to trackinformation about the company's sales force, maintain a transactionhistory of the information associated with multiple products, provideincentive based compensation to the company's sales force, and calculatesales force compensation based upon numerous variables. For example, thesystem referred to hereinafter as Distributor Management System Suite(DMSS) comprises a suite of applications that provide trackinginformation, such as contact points, payment methods, and organizationalhierarchies on all parties in the system, managing regulatoryinformation and ensuring that distributors are licensed and appointed tosell the products manufactured by the provider.

[0032] In one embodiment of the invention, DMSS comprises a suite ofmultiple engines and modules each configured to provide functionalitythat helps manage the flow of information between distributors andsuppliers. Generally, DMSS provides users with a mechanism for managinginformation related to distributors, validating and tracking licenses,creating customized contracts, and maintaining compensation structures.To perform such functions the system configured in accordance with oneembodiment of the invention stores information such as contractcomponents and rules, distributor financial information, bonusschedules, and license and appointment data. The engines and modules ofDMSS may, for example, be configured to perform at least the followingfunctions:

[0033] 1) Provide financial services institutions with the means tomaintain organization hierarchies associated with parties on the system(e.g., distributor records), track information such as contracts, andpayment methods (e.g. how a distributor is paid).

[0034] 2) Manage regulatory information and ensures that distributorsare licensed and appointed to sell the products manufactured by theprovider.

[0035] 3) Perform compensation configuration. It provides financialservices companies a toolkit for creating and modeling their complexcommission schedules used to compensate their sales force. For example,the system may calculate compensation for all distributors by buildingon top of a commission engine and using the engine, the commissionmodels, and the agreement models to calculate the compensation for allof its sales force.

[0036] 4) Models agreements or contracts between the financial servicescompany or provider and the distributors who sell the products. Theseagreements are termed ‘Selling Agreements’. A selling agreement definesa hierarchy of sales people that can sell products under that contract,it defines what products can be sold in that agreement, it defines whatcommission schedules can be used in that agreement, and it defines whichsales people participate in which commission schedule. The DMSS mayutilize the terms defined in selling agreements to calculatecompensations for all distributors.

[0037] 5) Managing information related to distributors, validating andtracking licenses, creating customized contracts, and maintainingcompensation structures. The information stored in the DMSS databasecomprises information such as contract components and rules, distributorfinancial information, bonus schedules, and license and appointmentdata.

[0038] 6) Manages payment and debt to distributors/sales representatives(e.g., net-pay and debt management).

[0039] In accordance with one embodiment of the invention DMSS is builton top of a commission engine configured to model and calculatecommission for the sales force. A commission engine takes two inputs, acommission model and a set of transactions, and generates ledger items(that correspond to payments) as output. Each transaction represents aphysical sales transaction, such as distributor selling a life insurancepolicy. The commission model represents two critical pieces of data: thesales team hierarchy and the commission schedules. The sales teamhierarchy comprises a hierarchy of all sales people that will beresponsible for a transaction. The commission schedules define formulafor translating transactions into ledger items. Commission schedules maybe modeled through quota, bonus, and plan objects. The commission modelutilized in one or more embodiments of the invention is described infurther detail in pending patent application Ser. No. 09/081857,entitled “Method and Apparatus For Determining Commission”, which inincorporated herein by reference.

[0040] DMSS complements the commission engine in that it provides amechanism for modeling selling agreements with commission models. Inaccordance with one embodiment of the invention, at least one commissionmodel exists for each selling agreement in DMSS. Agreement hierarchiesare modeled within the sales team hierarchy. The agreement commissionschedules are stored in accordance with one embodiment of the inventionin the commission model's quota, bonus, and plan objects.

[0041] The commission schedules used in an agreement are often the sameor similar across agreements. Therefore, the agreements are put togetherfrom contract kits. A contract kit contains a set of commissionschedules (also referred to as compensation components) that can be usedwithin an agreement. Each compensation component and contract kit isversioned, and the compensation component contains the commissionschedule information needed to generate a complete commission schedulein the commission model. Each agreement is then created from onecontract kit, and when the agreement is created a user can selectedwhich components from the kit to include in the agreement. When a newversion of a component or kit is created, a user can select to cascadethe new version to all the agreements that use it, or to leave theagreement using the old version.

[0042] DMS provides additional functionality by allowing dependenciesbetween models through linked hierarchies and pooling agreements. It isoften common for one party to receive credit or rollup from somebody'swork in a different agreement. This is accomplished through linkedhierarchies. A distributor (Ted) in one agreement (AG1) make be linkedto another distributor (Fred) in another agreement (AG2). This allowstransactions for Fred and all of his descendants to also be credited toTed.

[0043] It is also common for multiple parties to want to share workacross agreements. For example, one may wish to use one quota tocalculate qualification on a quota level, and another quota to calculatepayout. In this example, one would want several parties performance tocontribute to the qualification quota, even parties in differentagreements. Pooling agreements provide this functionality, by poolingwork from different agreement participants from potentially differentagreements into one quota. An extensible object model in accordance withone embodiment of the invention provides a framework for representingsuch agreements.

[0044] System Components:

[0045]FIG. 1 shows a block diagram representing an embodiment of asystem that utilizes the Distributor Management System Suite (DMSS) 105.As shown in FIG. 1, the DMSS comprises management modules 110, abackbone 120 allowing data exchange between applications and databases,and between applications, a commission engine 125, a number ofadditional data processing engines 140, and data storage and storagemanagement components 130. The DMSS is also configured to allow for theaddition of more applications and plugins 110 to provide additionalservices.

[0046] In an embodiment of the invention, the DMS comprises severalmodules and applications. In this example, the system is used byfinancial organizations to manage sales agreements, distributorcredentials, and sales compensation. However, the reader should notethat the system embodying the invention is also applicable outside ofthe financial services industry and that the term financial organizationis utilized for illustrative purpose only. The invention is not limitedsolely to the financial services industry, but may be applied to otherindustries. For example, the system may be utilized in any businessenvironment having a need to determine if individuals associated with asale are appropriately licensed, compensated. The invention may also beapplied to other business situations were companies must operatepursuant to the terms of an agreement.

[0047] DMSS comprises a DMS Database which may exchange data withmodules and engines via backbone 120. In accordance with one embodimentof the invention, backbone 120 comprises an information infrastructureused to integrate applications 110, engines 140 and 125, and databases130. Backbone 120 facilitates communication between data resources andmodules, and integration of different computing equipment, includinglocal networks, web interfaces, and back-office systems. Thus, backbone120 provides a mechanism for maintaining data storage and retrieval, inaddition to communicating changes and updates to the other modules.Backbone 120 is configured to retrieve data from the database inresponse to the needs of DMSS modules and engines and transmit that datato its requestor. Backbone 120 provides an extensible framework suitablefor building and integrating applications customized for the needs ofindividual clients. Backbone 120 receives information from the DMSSmodules and acts on it, storing the resulting object or sending it backto the module. As modules perform their tasks and functions, thebackbone communicates changes and updates to the rest of theapplications. Backbone 120 also provides communication between themodules by sharing data and functions. The DMSS and other applications110, engines 140, and databases 130 may execute bidirectional requestsand responses across backbone 120. Backbone 120 is configured toretrieve data from the database in response to the needs of DMSS modulesand engines and transmit that data to its requester. Backbone 120eliminates some of the need for developing custom code, and allowsdevelopers to integrate new applications without knowing all the otherapplications in the system.

[0048] Engines 140 and 125 may be launched by the DMSS modules via thebackbone and draw information from the DMSS databases. The enginesprocess the information, and store the resulting object in a database orthe backbone for further use by the DMSS modules and engines. Acommission engine 125, configured in accordance with one embodiment ofthe invention, utilizes backbone 120 to gather information aboutagreements from the database.

[0049] Commission engine 125 may, for example, identify relevant data inthe database and produce a set of objects. Once the engine has processedall the objects, commission engine 125 can generate payments based onthe agreements.

[0050] Workflow process engine 146, operating in accordance with oneembodiment of the invention, starts and responds to workflow eventsreceived from the DMSS modules through backbone 120. Workflow processengine 146 completes the desired workflow event and sends thatinformation back through backbone 120. In an embodiment of the inventionworkflow engine 146 enables users to create and run one or more businessprocesses. The processes may be created in a formatted data input (e.g.XML or Java) and become objects (business rules) in the backbone. Theworkflow engine 146 enables the flow of information in the DMSS andprovides users with a customizable mechanism for creating businessprocesses.

[0051] The DMSS may comprise a commerce configuration engine 144 thatallows users to define and enforce the set of rules governing howcontract kit components (e.g., document components and compensationcomponents) are combined into agreements for each distributor. Theinternal processes utilized by configuration engine 144 are described infurther detail in U.S. Pat. No. 5,825,651, entitled “Method andApparatus For Maintaining and Configuring System”, which in incorporatedherein by reference. The commerce configuration engine 144 utilizes thecontract kit for creating agreements between a distributor and afinancial services company.

[0052] A reporting engine 142 may be added to the DMSS and configured togenerate reports and store such reports in the database. Each componentof an agreement has a corresponding document, generated from reporttemplates, which describes that component. The DMSS may also haveadditional modules comprising a distributor administration module 115, alicense and appointment module 116, a selling agreements module 117, adebt management module 118, and a payment module to which is may bereferred to also as Net Pay module 119. These modules interact withbackbone 120 and engines to maintain relationships between financialservices institutions and their distributors.

[0053] In one embodiment of the invention, distributor administrationmodule 115 enables a financial services institution to record and tracka broad set of information associated with the institution'sdistributors. The distributor information may be stored in a centraldatabase and used by all other modules of the DMS suite. Distributorinformation may comprise personal contact information (e.g. address,telephone, facsimile, email etc.), including information about multiplecontact points, information from background checks (e.g. education,previous relationships with financial services institutions, personalcredentials etc.), financial information (e.g. bank address/accountinformation and payment, advance, repayment history etc.), license andappointment information (e.g. state and product eligibility), includingcurrent and historical license and appointment data, information abouterrors and omissions coverage.

[0054] Distributor information may also comprise any other type ofinformation associated with the distributor and/or the sales of producton behalf of the institution. Distributor administration module 115 mayalso provide services for creating and managing distributor databaseinformation, setting up organizational entities, such as sales teams,placing individual distributors in the teams, modifying the distributorinformation, and creating and managing a repository for data aboutselling agreements established between the financial servicesinstitutions and distributors. Also, distributor administration module115 may provide services for defining and managing relationships betweendifferent organizations (e.g. such as the financial services institutionand a distributor or between regional directors and sales offices),identifying and managing calendar-based events associated withdistributors such as selling agreement, licensing, and appointmentrenewals, background check renewals, and errors and omissions coveragerenewals.

[0055] A licensing and appointments module 116 may also be integratedinto the DMSS and configured to enable financial services institutionsto manage the license and appointment credentials for distributors andto validate compliance with industry regulations. The licensing andappointment rules enforced by the DMS suite are applied to distributorsmanaged by the system, whether they are employees of the financialservices institution or employed by an external distributor. However,the licensing and appointment rules may be selectively enforced in theevent that a user defines a set of rules defined a decision tree forperforming selective enforcement.

[0056] Licensing and appointments module 116 may also provide severalservices comprising defining license/appointment types by company,state, and either product or product line, determining the license andappointment requirements for producers (e.g., distributors or salesrepresentatives) based on their state of operation, the products theproducer sells, the kind of compensation paid to such producers andtheir role, monitoring license and appointment information associatedwith individual producers on a calendar and schedule basis and determinewhen renewal application processing is required, managing the licenseapplication process for renewals, updating licenses (e.g. for newproducts or states). In one embodiment of the invention, licensing andappointments module 116 includes the documentation and workflow for theapplication approval process providing services comprising managing theappointment application process for both renewals and new appointmentrequests, including the documentation and workflow for the applicationapproval process, providing license and appointment checking as required(e.g. for sales compensation or processing new business), validatingthat licensing/appointment requirements are met and holding activityuntil requirements are met.

[0057] When selling agreements module 117 is integrated into the DMSS inaccordance with one embodiment of the invention, the selling agreementsmodule 117 enables a financial services institution to define and createindividual business contracts with distributors. A selling agreementdefines the scope and terms of the relationship between the partiesinvolved, commission and bonus schedules, and documents describing therelationship. In one embodiment of the invention, each selling agreementdefines a hierarchy of sales people that can sell products under thatcontract, it defines what products can be sold in that agreement, itdefines what commission schedules can be used in that agreement, and itdefines which sales people participate in which commission schedule.Selling agreements are built from pre-defined contract kit componentscustomized during negotiations. For example, a selling agreement may beformulated using contract kits comprised of components such ascompensation components and document components. Each selling agreementis assembled by the system using rules (e.g., a component may berequired, optional, or standard) defining the relationships between eachof the components. Compensation components define the commissionstructure associated with a product to be sold and document componentsprovide other information related to the agreement (e.g., contract termsetc. . . . ).

[0058] The distributor's performance is measured and commission is paidaccording to the terms of the agreement (e.g., defined in compensationcomponents). In an embodiment of the invention, customizable contractkit components enable a financial services institution to define thecontent of contracts and the processes by which they are administered.The kits detail the rules and documentation required for theadministration of the agreement. A financial services institutiondefines the events that may occur and provides a set of possibleresponses to each event using various contract kit components. Sellingagreements module 117 may use contract kits to perform several taskscomprising: defining agreements that consist of contract components,defining the set of rules governing how contract kit components arecombined into selling agreements for each distributor, managing theapproval process for contract kit components and contract kits prior totheir promotion to active use, activating contract kit components andcontract kits for use, retiring contract kit components from active use,integrating with the commission engine to enable compensationcalculations based upon the parameters set in the selling agreement.

[0059] In an embodiment of the invention, DMSS comprises an integrateddebt management module 118 which enables a financial servicesinstitution to manage distributor advances and repayments. The debtmanagement module enables a user to define and manage the business rulesand parameters for the approval and payment of advances (e.g., via aninterface). A user may make adjustments to advance balances based onactual value received from commission and accelerate repayment schedulesif commissions are insufficient. The debt management module enables auser to define the rules and parameters associated with advances. Thedebt management module enables a user to define the following: classesof distributors who qualify for advances, qualification criteria foradvances (e.g. the distributor's length of service, sales history, andpast earnings), ratio of advances to projected income, taking intoaccount any outstanding advances, repayment schedule and interest rateto be paid, source of repayment income or the policy the advance is tobe recouped from, whether the amount is a percentage or flat rate,accelerated repayment schedules. For example, if a distributor's incomeprojections fall below repayments, a user may modify the repaymentterms, a user may also perform other activities such as initiatingadvances and repayment schedules, and tracking performance of debts.

[0060] The DMSS may also comprise a payment module 119 that enablesfinancial institutions to track and calculate payments to distributors.Payment module 119 (also referred to as a net pay module) determines adistributor's net pay by adjusting the party's total earned compensation(calculated by commission engine 125) according to a set of paymentadjustment rules. The commission engine utilized in one embodiment ofthe invention is described in further detail in pending patentapplication Ser. No. 09/081857, entitled “Method and Apparatus ForDetermining Commission”, which in incorporated herein by reference.These rules can be used to capture repayment schedules for outstandingdebt, and transfer payments to an alternate payee. In accordance withone embodiment of the invention, payment module 119 also allowssplitting up net payments into individual disbursements, directingdifferent parts of compensation to different accounts.

[0061] In one embodiment of the invention DMSS may also comprise a usermanager application 140 which defines and restricts user access andusage of the DMS suite. The system may use role-based access control,where roles are given specific permissions to data and entities. Usersof the DMS suite have several levels of usage and control in theapplication based on the pre-defined roles. A user may customize theseroles through the application user manager 140. In an embodiment of theinvention, a workbench application 113 is provided to enable users toview and manage sales transactions and distributor performance data, andto run the DMS engine.

[0062] The DMSS comprises, in addition to modules and engines, a set ofuser interfaces 150. User interfaces comprise a browser-based system formanaging the DMSS applications. This browser-based system may beimplemented using any network enabling communication protocols andapplications. For example, the browser-based user interface may includeJava Server Pages, script based common gateway interface or anyapplication capable of accessing the databases and producing intangibledata that can be rendered by a client browser.

[0063] Information Types:

[0064] In an embodiment of the invention, the DMSS comprises severaltypes data stored in the databases and corresponding modules, and usedin module-to-module, module-to-engine, and engine-to-enginecommunication. The system may represent such data in data objects.Compensation data and compensation rules data objects 132 storeinformation for the agreements module of the DMSS. This data may includecontract components such as quota levels, bonus rules, andcommission-based rules for eligibility. Distributor data and producerdata objects 133 store information about a financial servicesinstitution's distributors for the distributor administration 115 andthe other modules of the DMSS. This data includes contact information,background checks, continuing education credits, and financialinformation.

[0065] Selling agreements data and selling agreement rules data objects134 provides sharing data with the Agreements module 117 of the DMSS.Information in this database includes rules for contracts betweenfinancial services institutions and distributors, data defining theterms of contracts, and commission and bonus schedules. License data andappointment data objects 135 are used by the license and appointmentsmodule 116 of the DMSS. This data includes license and appointmentcredentials and variations of license and appointment types (such asvariations by state or product). The data is also used to validate thatrequirements for a license are met. Process rules data objects 136contain information relating to the DMSS workflow service. This dataincludes agreement components and business rules and data. Report dataobjects 137 contain report data and agreement components and may shareinformation with the report engine.

[0066] System Components Interactions

[0067] In an embodiment of the invention, modules perform their tasksand functions using the backbone 120. The backbone 120 communicateschanges and updates to the rest of the applications. The Backbone alsoprovides communication between the modules by sharing data andfunctions. The backbone 120 maintains data storage and retrieval, inaddition to communicating changes and updates to the other modules. Thebackbone retrieves data from the database in response to requests fromDMSS modules and engines and transmits that data to its requestor.

[0068]FIG. 2 is flowchart showing the process of communicating betweenmodules, the data processing engine, the DMSS backbone and the databasesin an embodiment of the invention. In step 220 a request is received bythe DMSS to perform a data processing task. This step involves startingthe modules required to handle the data processing task. The module dataprocessing task may require one or more services provided by specificdata processing engines. The module determines, if a specific engine'sservices are needed in step 230 and may start the designated engine byissuing a request through the backbone in step 240. In one embodiment ofthe invention, the module calls directly to the engine and the engineloads data through the backbone. In either case, the engine may requestthe data necessary for processing the modules request in step 250 thoughthe backbone. The backbone fetches the data from different sources ofdatabases in step 260. The engine processes the modules request in step270 and returns the processing result through the backbone to themodule. The module completes the processing in step 280 and continuesprocessing the data. The backbone updates the databases and othermodules in the DMSS in step 290.

[0069]FIG. 3 show a block diagram representing an example ofinteractions occurring within DMSS modules and engines in an embodimentof the invention. In this example, the selling agreements module 117 ofthe DMSS, acts through the workbench 113. The workbench 113 startscommission engine 125 by sending a request 310. In response, the engineobtains the appropriate agreements information from the databases viathe backbone 120 for its calculations and compensation functions. Thecommission engine gathers information about agreements from the databasethrough the backbone. The commission engine identifies relevant data inthe database and produces a set of objects for the selling agreementsmodule. Once the engine has processed all the objects, it can generatepayments based on the agreements. The resulting information is stored inthe database for extraction by the DMSS applications.

[0070]FIG. 5 provides an illustration of the process flow utilized inaccordance with one or more embodiments of the invention. The figuresshows that the system described above may be utilized to generate theselling agreement that defines a relationship between multiple parties(e.g., step 500). Once the selling agreement is generated the system maydetermine a commission amount associated with a sales transactionperformed by one of the parties based on said selling agreement (e.g.,step 502). However, before the system pays out the commission amount itmay determine if the parties associated with the sales transactionconform to regulatory or business requirements (e.g., step 504). Forexample, the system may determine whether the parties are validlylicensed or authorized to perform such sales transactions. If the secondparty is not validly licensed, the system may reject the salestransaction (e.g., step, 506). Once that determination is performed thesystem may distribute an appropriate payment (e.g., commission amount)to individuals associated with said sales transaction (e.g., step 508).In one embodiment of the invention, the distributed amount takes intoaccount any deductions or credits (e.g., via the payment engine or debtengine) that are to be applied to the commission amount. For example,the person responsible for the transaction (e.g., sales representative)may be paid some amount minus an amount owed.

[0071] Computer Execution Environment (Hardware)

[0072] An embodiment of the invention can be implemented as computersoftware in the form of computer readable code executed on a generalpurpose computer such as computer 400 illustrated in FIG. 4, or in theform of byte code class files executable within a Java™ runtimeenvironment running on such a computer, or in the form of byte codesrunning on a processor (or devices enabled to process byte codes)existing in a distributed environment (e.g., one or more processors on anetwork). A keyboard 410 and mouse 411 are coupled to a system bus 418.The keyboard and mouse are for introducing user input to the computersystem and communicating that user input to processor 413. Othersuitable input devices may be used in addition to, or in place of, themouse 411 and keyboard 410. I/O (input/output) unit 419 coupled tosystem bus 418 represents such I/O elements as a printer, A/V(audio/video) I/O, etc.

[0073] Computer 400 includes a video memory 414, main memory 415 andmass storage 412, all coupled to system bus 418 along with keyboard 410,mouse 411 and processor 413. The mass storage 412 may include both fixedand removable media, such as magnetic, optical or magnetic opticalstorage systems or any other available mass storage technology. Bus 418may contain, for example, thirty-two address lines for addressing videomemory 414 or main memory 415. The system bus 418 also includes, forexample, a 64-bit data bus for transferring data between and among thecomponents, such as processor 413, main memory 415, video memory 414 andmass storage 412. Alternatively, multiplex data/address 5 lines may beused instead of separate data and address lines.

[0074] In one embodiment of the invention, the processor 413 is anysuitable microprocessor or microcomputer for processing data. Mainmemory 415 is comprised of dynamic random access memory (DRAM). Videomemory 414 is a dual-ported video random access memory. One port of thevideo memory 414 is coupled to video amplifier 416. The video amplifier416 is used to drive the cathode ray tube (CRT) raster monitor 417.Video amplifier 416 is well known in the art and may be implemented byany suitable apparatus. This circuitry converts pixel data stored invideo memory 414 to a raster signal suitable for use by monitor 417.Monitor 417 is a type of monitor suitable for displaying graphic images.

[0075] Computer 400 may also include a communication interface 420coupled to bus 418. Communication interface 420 provides a two-way datacommunication coupling via a network link 421 to a local network 422.For example, if communication interface 420 is an integrated servicesdigital network (ISDN) card or a modem, communication interface 420provides a data communication connection to the corresponding type oftelephone line, which comprises part of network link 421. Ifcommunication interface 420 is a local area network (LAN) card,communication interface 420 provides a data communication connection vianetwork link 421 to a compatible LAN. Wireless links are also possible.In any such implementation, communication interface 420 sends andreceives electrical, electromagnetic or optical signals that carrydigital data streams representing various types of information.

[0076] Network link 421 typically provides data communication throughone or more networks to other data devices. For example, network link421 may provide a connection through local network 422 to local servercomputer 423 or to data equipment operated by an Internet ServiceProvider (ISP) 424. ISP 424 in turn provides data communication servicesthrough the worldwide packet data communication network now commonlyreferred to as the “Internet” 425. Local network 422 and Internet 425both use electrical, electromagnetic or optical signals that carrydigital data streams. The signals through the various networks and thesignals on network link 421 and through communication interface 420,which carry the digital data to and from computer 400, are exemplaryforms of carrier waves transporting the information.

[0077] Computer 400 can send messages and receive data, includingprogram code, through the network(s), network link 421, andcommunication interface 420. In the Internet example, remote servercomputer 426 might transmit a requested code for an application programthrough Internet 425, ISP 424, local network 422 and communicationinterface 420.

[0078] Processor 413 may execute the received code as it is received,and/or stored in mass storage 412, or other non-volatile storage forlater execution. In this manner, computer 400 may obtain applicationcode in the form of a carrier wave.

[0079] Application code may be embodied in any form of computer programproduct. A computer program product comprises a medium configured tostore or transport computer readable code, or in which computer readablecode may be embedded. Some examples of computer program products areCD-ROM disks, ROM cards, floppy disks, magnetic tapes, computer harddrives, servers on a network, and carrier waves.

[0080] The computer systems programs, apparatus, and/or methodsdescribed above are for purposes of example only. An embodiment of theinvention may be implemented in any type of computer system orprogramming or processing environment. Thus, a method and system formanaging distributor information is described in conjunction with one ormore specific embodiments. The invention is defined by the claims andtheir full scope of equivalents.

What is claimed is:
 1. A system for managing relationships between afirst party and a second party comprising: at least one processor;memory coupled to said at least one processor; said memory comprising aplurality of modules configured to manage distributor information; saidplurality of modules comprising a selling agreements module configuredto generate a selling agreement; said plurality of modules comprising acommission module configured to determine commission amounts associatedwith a sales transaction based on said selling agreement; said pluralityof modules comprising a licensing module configured to determine if aparty associated with said sales transaction has a valid license; saidplurality of modules comprising a payment module for distributingpayment associated with sales transaction to said party.
 2. The systemof claim 2 wherein said licensing module is further configured todetermine if a party associated with said sales transaction comprises avalid appointment.
 3. The system of claim 1 wherein said plurality ofmodules further comprises a distributor administration module configuredto manage information associated with a plurality of distributors. 4.The system of claim 1 wherein said selling agreement comprisescompensation components.
 5. The system of claim 4 wherein said sellingagreement comprises document components.
 6. The system of claim 5wherein said selling agreement s module configured to generate saidselling agreement utilizes a configuration engine to determine which ofsaid compensation components and said document components to include. 7.The method of claim 6 wherein said commission module accesses acommission engine to determine said commission amounts.
 8. The system ofclaim 1 wherein said selling agreement comprises a binding contractbetween an institution having at least one product and a distributor. 9.The system of claim 8 wherein said institution comprises financialinstitution.
 10. The system of claim 8 wherein said product comprisefinancial product.
 11. The system of claim 10 wherein said financialproduct comprises life insurance.
 12. A system for managingrelationships between a first party and a second party comprising: adatabase source comprising a plurality of data objects representative ofat least one distributing party, at least one selling agreement and atleast one license or appointment associated with said at least onedistributing party; a distributor management engine configured to obtainat least one of said plurality of data objects from said database sourceand determine whether said at least one distributing party conforms withsaid at least one selling agreement and said at least one license orappointment is valid.
 13. The system of claim 12 further comprising: abackbone coupled to said distributor management engine, said backboneconfigured to transport said at least one of said plurality of dataobjects.
 14. The system of claim 12 further comprising: an interface forobtaining a plurality of business rules defining relationships betweenan institution and said at least one distributing party.
 15. The systemof claim 13 further comprising: a commission engine configured toutilize said backbone to fetch said at least one selling agreement fromsaid database source.
 16. The system of claim 15 wherein said commissionengine generates commission schemes utilized to model a set of sellingagreement objects.
 17. The system of claim 16 wherein said distributormanagement engine generates payments based on said selling agreementobjects.
 18. The system of claim 12 further comprising: a workflowprocess engine configured to process workflow events.
 19. The system ofclaim 18 wherein said workflow process events are determined by businessrules defined by a user.
 20. The system of claim 19 further comprising:a commerce configuration engine configured to provide a configurationengine access to said business rules.
 21. The system of claim 12 furthercomprising: a report engine configured to generate a plurality ofreports associated with said at least one distributing party.
 22. Thesystem of claim 21 wherein said report engine utilizes report templatesto generate said plurality of reports.
 23. The system of claim 12further comprising: a distributor administration module for managingsaid plurality of data objects.
 24. The system of claim 12 furthercomprising: a licensing and appointment module configured to enable aninstitution to manage said at least one license or appointments dataobject for at least one said distributor.
 25. The system of claim 24wherein said licensing and appointment module is configured to validatelicense or appointment compliance with a set of industry regulations byevaluating said at least one license or appointment data object.
 26. Thesystem of claim 12 further comprising: a selling agreements moduleconfigured to enable said institution to define and create a businesscontract with said at least one distributing party.
 27. The system ofclaim 26 wherein said selling agreements module manages a set ofbusiness rules governing how contract components are combined into saidat least one selling agreement associated with each of said at least onedistributing party.
 28. The system of claim 27 further comprising: adebt management module configured to enable said institution to managedistributor advances and repayments.
 29. The system of claim 28 whereinsaid debt management module is utilized to define and manage a set ofpayment rules defining parameters for paying said at least onedistributing party.
 30. The system of claim 12 further comprising: a netpay module enabling said institution to track and calculate payments todistributors.
 31. The system of claim 12 wherein said institutioncomprises a financial services institution.
 32. A system for managingrelationships between a first party and a second party comprising: aninterface for obtaining a plurality of business rules definingrelationships between an institution and at least one distributor; adatabase source comprising a plurality of data objects representative ofsaid at least one distributor, at least one selling agreement and atleast one license or appointment associated with said at least onedistributor; a commission engine configured to determine a commissionamount associated with said at least one distributor by evaluating saidat least one selling agreement data object; a backbone coupled to saiddistributor management engine, said backbone configured to transportsaid at least one of said plurality of data objects to a plurality ofmodules; said plurality of modules comprising, a distributoradministration module for managing said plurality of data objects; saidplurality of modules comprising, a licensing and appointment moduleconfigured to determine if said at least one license or appointment dataobject associated with said at least one distributor is in compliancewith a set of industry regulations; said plurality of modulescomprising, a selling agreements module configured to enable saidinstitution to define and create a selling agreement with said at leastone distributor; said plurality of modules comprising, a payment moduleconfigured to distribute said commission amount to said at least onedistributor.
 33. The system of claim 32 wherein said commission engineutilizes said backbone to fetch said at least one selling agreement fromsaid database source.
 34. The system of claim 32 further comprising: aworkflow process engine configured to process workflow events, saidworkflow process events determined by said business rules.
 35. Thesystem of claim 32 further comprising: a commerce configuration engineconfigured to provide access to said business rules.
 36. The system ofclaim 32 further comprising: a report engine configured to generate aplurality of reports associated with said at least one distributor. 37.The system of claim 36 wherein said report engine utilizes reporttemplates to generate said plurality of reports.
 38. The system of claim32 wherein said selling agreement comprises a contract between saidinstitution and said at least one distributor.
 39. The system of claim38 wherein said selling agreements module manages a set of businessrules governing how contract components are combined into said at leastone selling agreement associated with each of said at least onedistributors.
 40. The system of claim 32 further comprising: a debtmanagement module configured to enable said institution to managedistributor advances and repayments.
 41. The system of claim 28 whereinsaid debt management module is utilized to define and manage a set ofpayment rules defining parameters for paying said at least onedistributor.
 42. The system of claim 12 wherein said institutioncomprises a financial services institution.
 43. A method for managingrelationships between a first party and a second party comprising:generating a selling agreement defining a relationship between a firstparty and a second party; determining a commission amount associatedwith a sales transaction based on said selling agreement; determining ifsaid second party associated with said sales transaction has a validlicense; distributing said commission amount to individuals associatedwith said sales transaction.
 44. The method of claim 43 furthercomprising: determining if said second party associated with said salestransaction comprises a valid appointment.
 45. The method of claim 43wherein said selling agreement comprises compensation components. 46.The method of claim 45 wherein said selling agreement comprises documentcomponents.
 47. The method of claim 43 wherein said generating saidselling agreement further comprises: obtain rules associated with saidselling agreement; determining which of said compensation components andsaid document components to include in said selling agreement based onsaid rules.
 48. The method of claim 43 further comprising: accessing acommission model to determine said commission amounts.
 49. The method ofclaim 43 wherein said first party comprises an institution having atleast one product to be sold by a second party.
 50. The method of claim49 wherein said second party comprises a distributor.
 51. The method ofclaim 49 wherein said institution comprises a financial institution. 52.The method of claim 51 wherein said at least one product comprisefinancial product.
 53. The method of claim 52 wherein said financialproduct comprises life insurance.
 54. A computer program productcomprising: a computer usable medium comprising computer readable codefor managing relationships between a first party and a second partycomprising, said computer readable program code configured to: generatea selling agreement defining a relationship between a first party and asecond party; determine a commission amount associated with a salestransaction based on said selling agreement; determine if said secondparty associated with said sales transaction has a valid license;distribute said commission amount to individuals associated with saidsales transaction.
 55. The computer program product of claim 54 furthercomprising computer readable program code configured to determine ifsaid second party associated with said sales transaction comprises avalid appointment.
 56. The computer program product of claim 54 whereinsaid selling agreement comprises compensation components.
 57. Thecomputer program product of claim 56 wherein said selling agreementcomprises document components.
 58. The computer program product of claim54 wherein said computer readable program code configured to generatesaid selling agreement further comprises computer readable codeconfigured to: obtain rules associated with said selling agreement;determining which of said compensation components and said documentcomponents to include in said selling agreement based on said rules. 59.The computer program product of claim 54 further comprising computerreadable program code configured to access a commission model todetermine said commission amounts.
 60. The computer program product ofclaim 54 wherein said first party comprises an institution having atleast one product to be sold by a second party.
 61. The computer programproduct of claim 60 wherein said second party comprises a distributor.62. The computer program product of claim 60 wherein said institutioncomprises a financial institution.
 63. The computer program product ofclaim 60 wherein said at least one product comprises a financialproduct.
 64. The computer program product of claim 63 wherein saidfinancial product comprises life insurance.